Although this presentation focuses on biotoxin events and Regulations, I hope you’ll allow me to "take the scenic route" and set the scene by firstly giving a brief overview of the European industry.

My intention is to focus on the molluscan cultivation sector as opposed to total bivalve supplies, as this is where future development lies - and therefore the first issue is to define ‘cultivation’ since our bivalves are natural feeders - we don’t supply artificial feed or pellets, as in finfish aquaculture.

The FAO definition overcomes this difficulty by focusing on control of the environment and legal ownership of the stock. This allows a clear separation between cultivation and capture fishery supplies for analytical purposes.

Before assessing the challenges posed by biotoxins, it is essential to understand the current characteristics, scale and profile of the European cultivation industry.

A relatively detailed picture of the industry is possible as a result of a comprehensive study of the aquaculture sector completed for the European Commission in 1999

by consultants ‘MacAlister Elliott & Partners’. A number of national organisations, most notably in France and Spain, have queried the accuracy of some of the data, nevertheless the report provides a useful ‘baseline’ of data presented on a comparable basis across the Community.

The Report concluded that the production of cultivated shellfish in 1997 totalled some 665 Thousand Tons :

• The data indicates that this volume is dominated by mussels, which, at 515 Thousand Tons, represented about threequarters of European shellfish output (and allegedly equal to around 70% of global mussel production);
• Oyster production (O edulis and C gigas) reached some 100 Thousand Tons, 15% of total EU cultivated shellfish output (representing 3% of world volumes);
• The third species assessed, clams, accounted for around 50 Thousand Tons, some 8% of European shellfish output (4% of global production).

With a first sale value of around Euro 600 Million, cultivated shellfish was worth around 30% of overall the Two Billion Euro European aquaculture business:

• Although still the dominant species, in value terms the importance of mussels declined to 47% of the total, some Euro 270 Million;
• First sale values for oysters and clams totalled around Euro150 Million for each species (26 - 28%).

Average prices ranged from just over Euro 500 per Ton for mussels, ranging from Euro 400 for dredged product to Euro1,600 for mussels grown in suspended cultivation in Scotland, to Euro 3,000 per Ton for clams.

There is an equally skewed distribution of the location of activity across the Union. Shellfish production is geographically extremely concentrated, with 73% attributable to only three countries - Spain, the leader, with 198 Thousand Tons or 30% of the total, followed by Italy with 143 Thousand Tons (22%) and France at 141 Thousand Tons (21%).

There is a similar pattern of concentration at the individual species level :

• Mussels : 75% from the top three producers, with Spain at 189 Thousand Tons (NB ‘Mexillon de Galicia’ estimate production at over 250 Thousand Tons), Italy at 103 Thousand Tons and The Netherlands at 93 Thousand Tons;
• Oysters : 94% from the top three producers, with France at 87 Thousand Tons (the ‘Comite National de la Cochyliculture’ estimate is 140 Thousand Tons), followed at a significant distance by Ireland at 4.4 Thousand Tons and Spain at 3.4 Thousand Tons);
• Clams : 96% from the top three producers (Italy at 40 Thousand Tons, Spain at 5.6 Thousand Tons and Portugal at 3.3 Thousand Tons).

In addition to these production and value parameters, a further particularly significant attribute of shellfish farming, reflecting the relatively ‘low tech’ nature of operations, is the contribution it makes to employment. The sector is calculated to generate around 20,000 Full Time Equivalent jobs in the production segment alone, over 50% of total direct employment in the European aquaculture industry.

The income generation opportunities created by shellfish cultivation have major socio-economic importance, as they are typically located in remote coastal regions where alternative employment is so often sadly lacking.

The European shellfish cultivation sector has historically lacked such a common voice in Brussels. This lack was remedied in 1999, with the creation of a Community-wide organisation to represent the sector’s interests in Brussels, and to improve communication and dialogue with the European Commission. With the encouragement and offer of support from the Commission, a number of national trade associations finally ‘bit the European bullet’ and formed the ‘European Mollusc Producers Association’ (EMPA).

Initial membership includes trade associations from England & Wales, France, Greece, Ireland, Scotland and Spain, with an expectation of expansion to include additional Member States representatives in the future. Nevertheless, the six founding members form a representative cross-section of Community producers, including examples of large scale and mature industries as well as smaller, more recently developed sectors, and both Atlantic and Mediterranean operations.

In addition, the combined production of EMPA national industries totals around 400 Thousand Tons, some 60% of European Union output.

The Association is therefore a legitimate voice for the European-wide sector and enjoys formal recognition as the Community-level representative for the industry.

EMPA expects to be the focus for industry representation, interaction and communication with the Commission, the Parliament and other European institutions in future discussions concerning direct sectoral issues and associated development of policies, including food hygiene legislation.

As the data above clearly indicates, the major difference between national bivalve sectors is one of scale, with production dominated by the ‘Big Four’ of Spain, Italy, France and the Netherlands. But for three of these producers the best expectation for the future is for marginal increases; indeed there are those who argue that France, Spain and the Netherlands have already, in certain areas, exceeded the optimal biological carrying capacity.

Italy is unique, in being the only current major producer with the potential for significant incremental production.

At the Community level, future expansion is forecast to come largely from countries with limited current volumes but with strategic goals to expand output in future years, such as Portugal, Ireland, Scotland, Sweden and Greece. These ‘peripheral’ EU suppliers will be joined by other expanding industries in Iceland, Norway, and potentially the nations of the Eastern coast of the Adriatic and the Black Sea.

However, there are constraints on future increases, in both groups of producers, including :

• Availability of suitable sites;
• ‘Spikes’ of bacterial pollution;
• Pollution ‘crises’, such as oil spillages (eg the ‘Erika’);
• Climate change (eg the ‘switching off’ of the North Atlantic Drift);
• Marine biotoxin events.

In my opinion, biotoxin contamination is likely to prove the greatest threat to the future of our industry, and not simply in Europe, but world-wide.

As the ICES maps of biotoxin events around Europe for the past decade indicate, the impact of algal toxins is extensive - what is not shown is that the extent of the events, their intensity and frequency, appear to be increasing through time.

Whether that is because we are monitoring with greater efficiency and analysing with improved accuracy, or because there is an underlying long term trend towards a higher level of toxicity in the environment, is still subject to debate.

Both explanations generate significant challenges for the future of the industry.

But one certain result is that the consumer is becoming more aware of perceived dangers in consuming bivalves.

Although monitoring and harvestimng controls are to safeguard consumers, closures frequently lead to "image erosion" as a rersult of unhelpful media interpretation.

Our industry is perhaps suffering part of the backlash resulting from the apparently endless litany of food safety concerns of the past decade - from BSE and dioxins through listeria and salmonella and chemicals.

There is no doubt that food safety legislation has been a lead issue within the European Community in recent years, with numerous Directives being implemented during the early 1990’s. And there has been an apparently never ending series of food safety concerns over the past decade, partly because of the new legislation and the enhanced intensity of monitoring it has generated.

The main objectives have been :

• To harmonise standards (the ‘Single Market’);
  
• To improve food safety for consumers.

The Directive that has most affected our industry is undoubtedly Directive 91/492 (and the companion ‘fisheries products’ Directive, 91/493), "laying down the health conditions for the production and placing on the market of live bivalve molluscs", with its detailed End Product Standards covering bacterial, salmonella, biotoxin and radionucloide levels and the definition of minimum requirements for documentation for Harvesting Areas and movements, depuration and despatch facilities and public health control systems (monitoring, closure mechanisms).

And the industry has broadly supported the Directive and its aims. There is support for the objective of inproving quality and safety of products and safeguarding public health - nobody wishes to ‘shrink’ the market through poisoning our customers! Harmonisation of standards is similarly positively supported, along with any reduction in negative media reports.

In summary, the industry has been and remains in favour of effective hygiene legislation, and acknowledges it as a essential prerequisite for future development.

But there are genuine concerns and legitimate criticisms :

• Are the Directives targeted at real risks and at improving consumer protection? Or is this all a bit of post-BSE paranoia?

• Have they been implemented in an appropriate and proportionate manner, and with equal vigour in all member states?

• And industry worries that by highlighting potential risks, the consumer has been made more confused, concerned and worried about shellfish, unecessarily and disproportionately to the real risk.

The food hygiene Directives are currently under review, with the potential for revision, as part of the consolidation of separate ‘vertical’ Directives to a single ‘horizontal’ food Regulation. The review process is on-going, but Commission officials have indicated that :

• As a Regulation rather than Directives, the legislation will focus on outcomes or targets rather than the method of achieving them, recognising differences between Member States;
  
• There is unlikely to be any changes in the Harvesting Area Classification criteria ;
  
• No changes should be expected on contaminants, viruses, etc;
  
• Probably some controls will be brought in for wild Pectinids;
  
• A significant emphasis on post-primary production HACCP;
  
• Changes for biotoxins :
  
  • ‘Unbundling of DSP complex to indivdual toxins (Yesso-, Pectino-, Azaspiracids, and Okadaic Acid);
    
  • Revised portfolio of testing methods;
    
  • Tiered harvesting regime for scallops with ASP : if whole animal test exceeds 20 ppm but is below 250 ppm, then harvested scallops must be shucked to adductor and gonad, which must then be tested separately; if the sample of either part exceeds 4.6 ppm, then that part must be destroyed; each batch must also be tested for End Product Standards (20 ppm of ASP); more on this later!
• With reference to imports from Third Countries, each company wishing to export must satisfy the hygiene requirements;
  
• Publication of the revised proposed Regulation is expected at end-2002.

As mentioned earlier, I believe biotoxin events are likely to continue to have a major restraining effect on our sector, especially if we fail to design innovative techniques to manage the impact of these occurances.

While one strand of management could be through polyculture of fish, shellfish and seaweeds, a second strand could be through a more holistic interpretation and implementation of Regulations.

Following the massive ASP event in Scottish waters in 1999, which closed the scallop sector for virtually twelve months, I initiated discussions with the European Commission in an effort to mitigate the impact, by seeking a ‘tiered marketing system’. This would enable the industry to limp along on adductor meat sales, but would be better than nothing.

To support the arguement that such sales would not pose a threat to public health, I organised a small scale research project. The results showed that toxins in the hepatopancreas tended to be 10 times greater than in the whole animal, while the toxin level in the adductor muscle tended to be less than one percent of the level in the whole animal.

As a result we have been seeking agreement to introduce a ‘tiered’ marketing regime which would allow a phased response to an ASP event, reflecting the ‘risk’ to consumer health. Surveillance would move from phytoplankton sampling to whole animal testing then separate part analysis, with the criterion for marketability remaing as the 20 ppm Action Level. Such an approach should satisfy the requirements of protecting public health without destroying the scallop industry.

However, the introduction of the tiered approach incorporating a 4.6 ppm ‘Trigger Value’, the recommendation of the Commission’s ‘ASP Expert Working Group’, which is claimed to reduce the chance of any scallop having a toxin level of above 20 ppm to one-in-a-thousand, is likely to permanently close down the scallop sector.

The proposal effectively converts what was a population average (the 20 ppm average in the sample) to an absolute ceiling value. The effect will be to drive fresh supplies from "whole animal" harvesting to a short period of "roe-on" meats, then to an extended period of "roe-off" meats. The impact on revenues will be two-fold, firstly fewer kilos of product sold, plus secondly, lower prices, as the white meat market is a global commodity market, with prices established by large volume frozen supplies from Chile, Argentina, Thailand, etc.

With the current cost structure of the NW European industry, it will be impossible to survive economically - jobs will effectively be exported to Third Countries as the EU sector is closed down.

And closed down not by the forces of globalisation, but by a mistaken, disproportionate decision by EU advisory scientists.

In the absence of a realistic risk assessment which takes into account individuals’ consumption of these highly priced seafood products, average meal portion size, consumer body weight, etc, industry will remain incredulous of the scientific recommendations.

In addition to these biotoxin issues, today the European industry appears to be facing an uncertain future, characterised by mature, slow growing markets with narrow profit margins, capacity constraints in the traditional, large volume producers and apparently suffering from an unending series of problems from pollution, biotoxins and potential for exotic introductions through to expensive hygiene legislation and the attentions of a zealous ‘Food Police’.

I would summarise this apparently somewhat downbeat assessment as, from an outside investor’s viewpoint, an industry suffering from a poor ‘Risk/Reward Ratio’, indeed, the worst possible combination of High Risk and, even when successful, Low Rewards.

If we carry on with traditional attitudes, under a ‘Business As Usual’ scenario, the outcome will be a disparate industry, fragmented into national camps, isolated from other interest groups, failing to achieve environmental improvements and suffering from negative market perceptions, spiralling down to lower volumes and reduced political strength - suffering from a continued negative Risk/Reward Ratio.

Alternatively, the industry can face up to the challenges, such as biotoxin events and the requirement for Integrated Coastal Zone Management, and embrace the opportunities for multi-sectoral alliances (even with interest groups that we have historically opposed). Production can be expanded in peripheral countries, new markets can be deveoped through innovative marketing of processed products.

And the management and mitigation of HABs and shellfish toxicity through multi-species nutrient budgeting and the development of pragmatic Regulations based on risk assessment are central to the creation of a dynamic, expanding, profitable industry, one that is attractive to future generations of proud cultivators of the seas, and playing a major role in the sustainable development of the coastal zones of Europe and, by extension, of other countries around the planet.

"Joined up policies" from the EU and APEC, in the wider context of the WTO, are essential for the emergence of this positive vision - and a further crucial element of this approach is improved communication between industry, regulators and the scientific community, so I look forward with confidence to a 3rd HAMM Conference sometime in the future!